The Pentagon prides itself on solid contingency planning, with one glaring exception: the prospect of reduced funding. Only in the past couple of months has the Defense Department begun to prepare for the significant budget cuts likely this year.

Yes, there will be hiring freezes, furloughs, suspension of nonessential travel, reduced depot maintenance activity, smaller base operating budgets and fewer training exercises. But such measures can be sustained for only a short while. They are emergency measures designed to weather a passing storm. But it should be clear by now that the nation's fiscal and economic tempests will not soon dissipate.

Whether or not the sequester goes into effect -- or lasts only a couple of months -- the Pentagon's budget is surely coming down another notch or two. It would be wise to prepare for a 2014 budget that is $10 billion to $30 billion lower than those of the past few years. After that, defense spending will probably continue to trend downward for a while. That's simply the reality of the current economic and strategic circumstance. It's time for defense leaders to plan accordingly.

Some hope that tax hikes will rescue the Defense Department from further fiscal restraint. But even if the government's share of national income rises, there is a long list of urgent priorities competing for funds -- not to mention a mountain of debt to redress. And the broader context for these challenges is a change in the strategic environment that gives greater prominence to the shape of the global economy and the United States’ position in it. This portends a new deal for defense, like it or not.

The surest way to make smaller Pentagon budgets work is to cut end strength and structure -- fewer troops, brigades, ships and aircraft. In the near term this might be managed by reducing the number of soldiers and the size of units routinely stationed or rotated abroad. Force structure also contracts as large-scale operations in Iraq and Afghanistan end.

For the longer term, more is needed: a serious rethink of how to produce, organize and use American power. The fifth Quadrennial Defense Review, due next year, creates an opportunity to draw a blueprint for change. What’s been missing so far is an official commitment to reform that matches the change in America's strategic circumstances.

What should we as a nation minimally expect?

First, defense planning must clearly prioritize those real and present challenges of most concern. Maintaining an excessively large and costly force today does not afford the flexibility to respond to military challenges in the future. It saps it.

Defense leaders must bring greater realism to bear when setting goals for the armed forces. Ill-defined and unbounded missions -- like taking the leading role in policing the global commons or attempting to transform nation states -- distract the military from tasks it can confidently accomplish at a sensible cost.

As the armed forces grow smaller, defense planners should reengineer their command and support structure. Otherwise, the tail tends to get longer while the teeth get shorter. Consolidating major commands and reducing the number of general and flag officers would be a start. Other priorities are consolidating maintenance depots and systems, basic and flight training programs, service schools, as well as medical, commissary and family services. In addition, there are redundant military bases to close, perhaps beginning overseas, but also here at home.

New security concerns and tighter fiscal constraint both warrant a fresh look at the services’ roles and missions. Defense planners should aim to reduce redundancies and improve cooperation. Acquisition is one area that would benefit from moving more authority to the joint level, helping to ensure procurements reflect overall defense needs, rather than service preferences.

None of these changes will come easily. That's why so many of these sensible reforms were side-stepped in the 1990s during the last drawdown, and with predictable results: a 40 percent increase in the base budget between 1998 and 2009. But money can no longer substitute for political will. What the country now needs from defense leaders in the White House, in the Pentagon and in Congress is less talk of catastrophe and Draconian cuts and more commitment to real reform.

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